The State of Late Payment report: public sector data

Dan Oliver February 5, 2016Comments Off on The State of Late Payment report: public sector data

In February, MarketInvoice will be launching ‘The State of Late Payment’ report, a detailed anaylsis of over 20,000 invoices taken from debtors across the world in the last 5 years.

The second preview of the report features the public sector, looking at the payment records of councils, hospitals, schools and more.

UK public sector as debtor:

2015

2014

Paid on time

3.3%

4.0%

Paid Late

61.7%

44.7%

Paid Early

35.0%

50.7%

1 week late +

44.3%

34.1%

2 weeks late +

30.9%

22.6%

1 month late +

10.9%

6.5%

Average payment days:

6.3 days late

0.4 days late

* Data taken from over 1500 invoices across 5 years – paid by local authorities & councils, educational institutions, the NHS, the Bank of England and central Government departments.

Key points:

Late payment by public sector bodies appears to have increased significantly in the last year. In 2014 44.7% of all public sector owed invoices were paid late, in 2015 this number jumped to 61.7% – meaning nearly two-thirds of invoices owed by public sector bodies were paid late.

In 2015 the public sector (61.7% paid late) had a worse record than FTSE 350 (60.9%) companies, banks (44.7%), and tech companies (50.5%).

One third (31%) of invoices owed by public sector bodies were paid more than two weeks late.

If you’re owed money by a public sector body, you will on average be paid nearly 1 week late (6.3 days), again this compares badly with FTSE 350 (4 days), banks (0.3 days), and tech companies (1.7 days).

Educational institutions have a particularly poor record –

8 out of 10 of payments by schools, colleges and academies were paid late last year.

Average pay day of 17.9 days late.

Sector comparisons:

Debtor sector

Percentage of invoices paid late last year

Supermarkets

68.7%

Retailers

63.3%

Public sector

61.7%

Energy companies

54.7%

Technology companies

50.5%

Banks

44.7%

Debtor sector

Average pay day last year (days late)

Public sector

6.3

FTSE 350 companies

4.0

Technology companies

1.7

Banks

0.3

Debtor sector

Percentage of invoices paid 2 weeks or more late

Public sector

30.9%

Banks

21.4%

Technology companies

14.8%

FTSE 350 companies

12.3%

When a business uses MarketInvoice, we capture the due date, expected payment date, as well as the issue date of every invoice. Invoices are verified by the end debtor. Debtors pay into a trust account managed by MarketInvoice, meaning record the eventual payment date when the invoice is settled.